Korea: Manufacturing PMI improves slightly in July
August 3, 2020
The IHS Markit manufacturing Purchasing Managers’ Index (PMI) ticked up to 46.9 in July from 43.4 in June, inching closer to the 50-threshold that separates an improvement from a deterioration in the manufacturing sector over the previous month.
July’s reading was driven by a softer contraction in new orders. Moreover, production fell at a moderated pace in July, partly due to a gradual reopening of factories, especially in the automotive sector. However, despite these improvements, post-production inventories increased at the fastest pace in eleven-and-a-half years, indicating still-subdued demand. Moreover, strains on international supply chains led to delays in the delivery of required input goods. In terms of prices, input costs increased for the first time in several months, although firms continued to lower prices to entice demand. On the labor front, firms continued to cut their headcounts, although at a slightly slower pace.